My car is totaled! Now what?

So your car is totaled: What should you do? ‘Totaled’ means that the cost of fixing your car is more than your car is worth (or what you could sell it for if in pre-crash condition). Insurance companies are required to pay you fair market value for your vehicle. Fair market value is what your car would sell for on the open market in pre-crash condition. The value of your car is not what you owe on your car. The value of your car is not the amount you may have recently purchased the car. Also, sentimental value of a car does not have to be paid, pursuant to law.

The insurance company will likely use their own software program to determine the value of your car. Keep in mind that the insurance company isn’t looking to overpay for wrecked vehicles. However, there is generally some room to negotiate. You should do internet research of your car considering the same make, model, year, condition, and mileage, around your geographic area (within a 60 mile radius). Search valuation websites (www.kbb.com or www.nadaguides.com are good ones) and used car marketplaces (www.autotrader.com and www.cars.com are two examples of many). See what similar vehicles are going for to develop your own range of value. Another option is to have an appraisal of the car by a qualified appraiser or someone in the business of selling used cars.

By doing this minimal leg work, when you discuss the amount the insurance company wants to pay, you are armed with some research and reference of value. In the event that you just put new tires on the vehicle, or you have custom parts on your vehicle, research the value of those parts and discuss the upgrades with the insurance adjustor. The goal is to get what you rightfully deserve for the value of your vehicle. So be realistic. But don’t let the insurance company get you in a headlock from the start because you haven’t done your homework to know what your car is truly worth.